Answer:
Computation of a Three-Period Moving Average Forecast
Period  Demand  3-period moving average
1 Â Â Â Â Â Â Â Â 58
2 Â Â Â Â Â Â Â 54
3 Â Â Â Â Â Â Â 60 Â Â Â Â Â 57.33
4 Â Â Â Â Â Â Â 53 Â Â Â Â Â 55.67
5 Â Â Â Â Â Â Â 63 Â Â Â Â Â 58.67
Explanation:
a) Data and Calculations:
Period  Demand  3-period moving average
1 Â Â Â Â Â Â Â Â 58
2 Â Â Â Â Â Â Â 54
3 Â Â Â Â Â Â Â 60 Â Â Â Â Â 57.33 (58 + 54 + 60)/3
4 Â Â Â Â Â Â Â 53 Â Â Â Â Â 55.67 (54 + 60 + 53)/3
5 Â Â Â Â Â Â Â 63 Â Â Â Â Â 58.67 (60 + 53 + 63)/3
b) The three-period moving average is computed by summing the demand for periods 1, 2, and 3 and dividing it by 3. Â The result becomes the moving average for period 3. Â This process is repeated by eliminating the first one and adding the next number until the end.
